Personal
Selling and
Sales
Management
Chapter 17
Lamb, Hair, McDaniel
2014-2015
1
© Cengage Learning 2015. All Rights Reserved.
• Describe personal selling
• Discuss the key differences between
relationship selling and traditional selling
• Describe customer relationship management
• List the steps in the selling process
• Describe the functions of sales management
© Cengage Learning 2015. All Rights Reserved
2
Advantages of
Personal Selling
 Personal selling provides detailed explanation or
demonstration of the product.
 Message can be varied according to motivations of
each customer.
 Personal selling can be directed only to qualified
prospects.
 Costs can be controlled by adjusting the size of the
sales force in one-person increments.
 Personal selling is considerably more effective than
other forms of promotion in obtaining a sale and
gaining a satisfied customer.
1
© Cengage Learning 2015. All Rights Reserved
3
Exhibit 17.1
Comparison of Personal Selling and
Advertising/Sales Promotion
Personal selling is important
if…
Advertising and sales
promotion are more
important if…
The product has a high value.
The product has a low value.
It is a custom-made product.
It is a standardized product.
There are few customers.
There are many customers.
The product is technically
complex
The product is easy to
understand.
Customers are concentrated
Customers are geographically
dispersed.
Examples: Insurance policies,
custom windows, airplane
engines
Examples: Soap, magazine
subscriptions, cotton t-shirts
© Cengage Learning 2015. All Rights Reserved
4
Relationship Selling
Relationship selling, or
consultative selling, is a sales
practice that involves building,
maintaining, and enhancing
interactions with customers in
order to develop long-term
satisfaction through mutually
beneficial partnerships.
2
© Cengage Learning 2015. All Rights Reserved
5
Exhibit 17.2
Key Differences between Traditional Selling and Relationship Selling
Traditional Personal Selling
Relationship or Consultative Selling
Sell products (goods and services)
Sell advice, assistance, and counsel
Focus on closing sales
Focus on improving the customer’s bottom
line
Limited sales planning
Consider sales planning as top priority
Spend most contact time telling customers
about product
Spend most contact time attempting to build a
problem-solving environment with the
customer
Conduct “product-specific” needs assessments Conduct discover in the full scope of the
customer’s operations
“Lone wolf” approach to the account
Team approach to the account
Proposals and presentations based on pricing
and product features
Proposals and presentations based on profit
impact and strategic benefits to the customer
Sales follow-up is short term, focused on
product delivery
Sales follow-up is long term, focused on longterm relationship enhancement
SOURCE: Robert M. Peterson, Patrick Schul, and George H. Lucas, Jr., “Consultative Selling: Walking the Walk in the New Selling
Environment,” National Conference on Sales Management Proceedings, March 1996.
© Cengage Learning 2015. All Rights Reserved
6
Customer Relationship
Management
Identify customer relationships
Understand interactions of the
customer base
Capture customer data
Leverage customer
information
3
© Cengage Learning 2015. All Rights Reserved
7
Identify Customer
Relationships
Companies that have CRM systems:
• Follow a customer-centric focus or
model
• Use knowledge management systems
• Organize information gathered
through the “learning” process
• Learn via interactions
3
© Cengage Learning 2015. All Rights Reserved
8
Interactions of the Current
Customer Base
CRM is built on interactions between
customers and organizations.
• Touch points occur at a wide
variety of locations.
– Web-based interactions are an
increasingly popular.
– One popular touch point is the pointof-sale touch point.
3
© Cengage Learning 2015. All Rights Reserved
9
Capturing Customer Data
Rather than focusing on the amount
of data that can be obtained,
companies should focus on the type
of data to be acquired and how it can
be used to enhance relationships.
3
© Cengage Learning 2015. All Rights Reserved
10
Leveraging Customer
Information
Campaign management
Retaining loyal customers
Cross-selling other
products and services
Designing targeted marketing
communications
3
© Cengage Learning 2015. All Rights Reserved
11
Steps in the Selling Process
Generate Leads
Qualify Leads
Probe Customer Needs
Develop Solutions
Handle Objections
Close the Sale
Follow Up
4
© Cengage Learning 2015. All Rights Reserved
12
Generating Leads
Advertising
Webinars
Trade Shows/
Conventions
Direct Mail
Social Media
Telemarketing
Referrals
Networking
Cold Calling
4
© Cengage Learning 2015. All Rights Reserved
13
Cold Calling
A form of lead generation in which
the salesperson approaches
potential buyers without any prior
knowledge of the prospects’ needs
or financial status.
4
© Cengage Learning 2015. All Rights Reserved
14
Exhibit 17.5
Relative Amount of Time Spent in the Key Steps of the
Selling Process
Source : Robert Peterson, Patrick Schul, and George H. Lucas Jr., “Consultative Selling: Walking the Walk in the New Selling Enviroment,” National Conference on
Sales Management Proceedings, March 1996.
© Cengage Learning 2015. All Rights Reserved
15
Sales Management
Sales managers must:
• Define sales goals and the sales
process
• Determine the sales force structure
• Recruit and train the sales force
• Compensate and motivate the sales
force
• Evaluate the sales force
5
© Cengage Learning 2015. All Rights Reserved
16
Sales Force Structure
Sales department organization:
• Regional
• Product Line
• Marketing Function Performed
• Market or Industry
• Client or Account
– Allows for more specific and better
customer service
5
© Cengage Learning 2015. All Rights Reserved
17
The Sales Force
Strong Ego
Risk Taker
Sense of
Urgency
Intelligent
Assertiveness
Creative
Sociable
Empathetic
Relationship Oriented
5
© Cengage Learning 2015. All Rights Reserved
18
Compensating the Sales Force
• Compensation planning is one of the
sales manager’s toughest jobs. Only
good planning will ensure that
compensation attracts, motivates, and
retains good salespeople.
• Although the compensation plan
motivates a salesperson to sell,
sometimes it is not enough to produce
the volume of sales or the profit margin
required by sales management.
5
© Cengage Learning 2015. All Rights Reserved
19
Evaluating the Sales Force
• Performance evaluations allow
managers to review the strengths
and weaknesses of the sales force.
• This information can then tell a
manager what sales skills might
need to be reassessed or retrained.
5
© Cengage Learning 2015. All Rights Reserved
20
The Impact of Technology on
Personal Selling
Cell Phones
Laptops
Pagers
E-Mail
Electronic Organizers
Internet
5
© Cengage Learning 2015. All Rights Reserved
21
Ch 17 Discussion Questions
1. What is personal selling? When
should we opt for personal selling
over advertising?
2. What is relationship selling? Explain
its role in Customer Relationship
Management.
3. Explain the steps involved in
Personal Selling.